KELLY MCEVERS, HOST:
We're going to dig into a number now that we have heard a lot about since the weekend - $960 million. That is how much Donald Trump reported losing on a tax return in 1995 - this according to documents obtained by The New York Times.
On the campaign trail, Trump has been blaming the economic downturn of the early '90s for his financial problems, but NPR's Joel Rose reports that former employees and business associates say Trump was also to blame.
JOEL ROSE, BYLINE: How do you lose more than $900 million? We asked someone who used to work for Donald Trump.
BARBARA RES: I think a good part of it was mistakes.
ROSE: Barbara Res is a former executive vice president at the Trump Organization. She managed construction at Trump Tower. Res says the mistake started in the 1980s when Trump paid $365 million for a failing airline and 400 million for the Plaza Hotel.
RES: He overpaid from all that stuff, so those were not wise decisions. Those were mistakes on his part.
ROSE: Those mistakes alone don't quite account for the $900 million loss that's reported on Trump's state tax returns in 1995. We don't know exactly where that figure comes from because only a few pages were leaked. A loss that big could have allowed Trump to avoid paying federal income tax for years.
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DONALD TRUMP: As a businessperson, I've legally used the tax laws to benefit - really I mean it's to my benefit - and the benefit of my company, my investors, my employees, my family.
ROSE: At a rally yesterday in Colorado, Trump did not dispute the broad strokes of the story, but he blamed the recession of the early 1990s for his financial problems.
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TRUMP: I was able to use the tax laws of our country and my skills as a businessperson to dig out of this real estate depression when few others were able to do that.
ROSE: But some say Trump brought those massive losses on himself by borrowing too much.
ALAN POMERANTZ: All the assets that he bought - the shuttle, his real estate - he believed he could make a lot of money on them. He was wrong. His judgment was wrong.
ROSE: Alan Pomerantz is a lawyer who represented dozens of banks in negotiations with Trump. At one point in the early '90s, Trump owed $3.4 billion. He was personally on the hook for more than $800 million of that money. Pomerantz says investors lost big while Trump claimed the tax benefits for himself.
POMERANTZ: The only reason he gets to a $900 million loss is 'cause he lost the money by doing that kind of very risky business, by being a gambler, if you will. He took an inappropriate risk for other people's money.
ROSE: Trump's biggest gamble, the one that may have hurt him the most, was the Trump Taj Mahal casino in Atlantic City. Trump paid more than $600 million for the unfinished casino. The eighth wonder of the world, as it was billed, opened in 1990 and filed for bankruptcy the next year. Steven Perskie was the head of the New Jersey Casino Control Commission at the time.
STEVEN PERSKIE: We certainly knew that the big financial picture for Trump was terrible as opposed to what he was marketing to the rest of the world.
ROSE: The Casino Commission could have revoked Trump's gaming license, but it didn't. Trump had two other casinos in Atlantic City, and the commission was trying to protect the city's main industry. Alan Pomerantz says the bankers he represented made a similar calculation when they allowed Trump to sell off the assets he could no longer afford.
POMERANTZ: What we did as a bank group is we said, you know, why should we be self-destructive and put the guy into bankruptcy? We'll get less out of him than if we send him out here and make him walk around as if he is still successful and alive and sell all the stuff for us.
ROSE: Pomerantz thinks Trump's overall losses in the '90s were probably greater than $900 million, but there's no way to know for sure without seeing Trump's federal tax returns. He's the only major party candidate in the last 40 years who hasn't released them. Joel Rose, NPR News, New York. Transcript provided by NPR, Copyright NPR.
